The 20-year-old defender has been with the Reds since the age of seven and enjoyed a breakout campaign in 2023-24, making 16 appearances after stepping in to Matt Beard's senior squad on a consistent basis.
The lifelong Liverpool supporter played an important role as Beard's side secured an impressive fourth-placed finish in the Barclays Women's Super League, and has now reaffirmed her commitment to the club ahead of the forthcoming season.
Parry will also have a new squad number for the 2024-25 campaign, switching from No.32 to No.2 following the summer departure of Emma Koivisto.
"I'm delighted," Parry told Liverpoolfc.com shortly after signing her new contract.
"I'm just really excited to keep pushing. This is where I want to be and I'm happy, so I think this is the best place for me to do it.
"I've been here since I was seven, a shy little girl just wanting to express myself through football. I've been a Liverpool fan my whole life, growing up and watching my idols play. I had a season ticket, I remember watching the women's team play at Widnes and my family are all Reds.
"We are all excited and Reds through and through."
